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By Shivani Bazaz Feb 20, 2023 1:46:35 PM IST (Published)
SBI Mutual Fund has been tasked with managing this fund. For now, it will only cover debt mutual funds, except overnight funds and gilt funds, industry sources told CNBC TV18. Open-ended debt fund will have to contribute 25 bps of their assets to the Corporate Debt Market Development Fund (CDMDF). In addition, asset management companies (AMCs) will also contribute some amount from their books to this fund.
The Indian government's Rs 30,000 crore safety fund for the corporate bond market would help deepen it and also boost investor confidence, market analysts and fund managers said. The fund, which was ideated in Budget 2021, will be called the Corporate Debt Market Development Fund (CDMDF). Its purpose would be to stabilise and deepen the corporate debt market in stressful situations — for example when the global COVID-19 pandemic hit in 2020 — that could impact liquidity in the system.
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The fund will run like an alternative investment fund (AIF) scheme.
SBI Mutual Fund has been tasked with managing this fund. For now, it will only cover debt mutual funds, except overnight funds and gilt funds, industry sources told CNBC TV18. Open-ended debt fund will have to contribute 25 bps of their assets to the CDMDF. In addition, asset management companies (AMCs) will also contribute some amount from their books to this fund.